This proposal for a Clinical Mental Health Academic Award (CMHAA) in Geriatric Psychiatry is aimed at developing the career of Dr. Mary F. Morrison as an independent investigator and teacher, with a focus on the biological aspects of older women's mental health, particularly the role of sex steroids in depressive illness. The CMHAA will build on Dr. Morrison combined training in Internal Medicine and Psychiatry and on her background in clinical research and methodology. The training plan has four components. (1) Formal coursework and tutorial in: a) research design and statistical analysis, b) basic neuroendocrinology. (2) Participation in three ongoing clinical research projects under the supervision of a senior research scientist, Dr. Ira Katz: a) Role of endogenous sex steroids in the development and treatment of depression in elderly women in the nursing home; b) Pilot study of tamoxifen- induced depression in early stage breast cancer patients; c) Treatment of post-myocardial infarction depression with sertraline. (3) design and execution of an original clinical research project - A clinical trial of estradiol patch for treatment of mild to moderate depression (minor or major) in postmenopausal women, with the addition of sertraline to patch non-responders, also supervised by Dr. Katz (4) preparation of an RO1 grant application based on the research performed during the award period. The research study that will serve as the primary vehicle for advanced training will enroll 88 women, age> 50 (one third 50-60, one third 61-75, and one third over 75) with Geriatric Depression score > 10 and Hamilton score 8- 19, inclusive. Subjects will be treated with estradiol (Estraderm patches) or placebo administered under double-blind conditions for a period of 12 weeks, followed by two weeks of progesterone treatment. For subjects who remain symptomatic, continued double-blind treatment with estradiol or patch will be augmented with the antidepressant sertraline starting at a dose of 50mg/day. The specific aim of the study are: 1) To determine whether estradiol is an efficacious treatment for the target disorders, and whether the outcome of treatment is affected by age in the postmenopausal years. 2) To determine whether estradiol potentiates the antidepressant effects of sertraline in the target disorders. 3) To determine whether estrogen treatment of mild to moderate depression in postmenopausal women is associated with improvements in Functional status. 4) To evaluate the tolerability of hormone replacement therapy in women throughout the postmenopausal years.